Restex has a? debt-equity ratio of

0.760.76?,

an equity cost of capital of

18 %18%?,

and a debt cost of capital of

9 %9%.

?Restex's corporate tax rate is

30 %30%?,

and its market capitalization is

$ 199$199

million.

a. If? Restex's free cash flow is expected to be

$ 5$5

million one year from now and will grow at a constant? rate, what expected future growth rate is consistent with?Restex's current market? value?

b. Estimate the value of? Restex's interest tax shield.